The Zen master, Thich Nhat Hanh once observed that anyone wanting to understand the Buddhist concept of the Hungry Ghost need only visit Las Vegas. The Hungry Ghosts are souls tortured in a specific hell realm for particularly evil deeds driven by desire, greed, anger, or ignorance. Hungry Ghosts are pictured as having gigantic bloated stomachs with necks that are too thin to swallow food. Attempting to eat is extremely painful, as is the insatiable desire to feed a hunger that can never be appeased.
Steve Wynn, the owner of several hotel casinos in Las Vegas and Macau, the new Chinese Las Vegas, revolutionized the business. Before Wynn started building large spectacularly luxurious casinos, most of the hotels in Vegas were little more than glorified motels attached to casinos, show rooms, and famously inexpensive restaurants. Everything was subsidized to bring players into the casino. Gambling paid for the hotel, restaurants, and the shows. Wynn changed the rules. He decided that every aspect of the business should generate a profit. He built hotels that were an order of magnitude more expensive than anything seen before. He charged an appropriate price for that kind of room. The occupancy rate for this new kind of hotel proved that Wynn’s business model was sound. No more free food! Wynn opened world class restaurants with world class prices. They made money. He once observed, “There are people who rather have a bottle of wine than $1,000 in their pocket. I want to be certain that I am the one who provides that special bottle of wine to my customer.” Steve Wynn correctly guessed that people are willing to pay—a lot—for the things they really value whether that would be the adrenalin rush of high stakes roulette or the gourmet who wants to eat a meal prepared by a celebrity chef in a five star restaurant.
The reality TV show, Pawn Stars is set in Las Vegas. The owners of the pawn shop are willing to buy anything that they can resell for a profit. The entertainment value comes from watching people try to sell their prize possessions, guessing the value (if any) of bizarre items like a WWII hand grenade signed by general George Patton (OK, I made that one up). An expert is consulted to authenticate the signature and the bomb. If it is the real deal, the owner and the pawn broker argue over the price until an agreement is reached, or the disappointed seller walks sadly away from the store. The visitors always tell the camera why they are willing to part with their treasure. The reason given tells a lot about the values of the seller. Since this is Las Vegas, many of the Pawn Stars customers are raising money for the slots, the opportunity to take their wife to an expensive restaurant, or upgrade their hotel room. Others are raising money for their wedding or their grandchildren’s college educations. Some are collectors, selling one antique firearm to get the money to buy the next antique firearm. They are making enough money to feed their habit without infuriating the wife. The owners of the pawn shop value money. Typically, they are looking for 100% profit before taxes and overhead. If it is something they know they can flip with a phone call to an existing customer, they will take less, as they understand the time value of money.
This morning, I listened to another video explaining that almost half of American families could not cover a $400 emergency without hitting the credit card or selling something of value. The author, who lives in one of the most expensive zip codes in America, admits that frequently he is one of those Americans, even though he has earned significant amounts of money. He values an address in the Hamptons and expensive private schools for his daughters more than he values $400 in the bank. I simply can’t understand people who can live without any contingency plans. When I was earning little more than minimum wage bagging cloth in a textile mill, I would volunteer to work overtime to make certain I had money in the bank. I was willing to scrimp on food, drive an aging rust bucket, and share a small apartment with a roommate, but if my bank balance dropped below $1,000 (which it did) I took immediate, radical action to rectify the situation.
It’s all a question of your values. If you value getting high, you will be willing to risk your freedom or even your life to satisfy that desire. If you value your child’s education, you will live in a small house, drive old cars, or take a part time job to cover the tuition to the best private school in town. If you show me your credit card records and your checkbook register, I will have a pretty clear picture of what you really value.
But America is Las Vegas.
I once heard Doyle Brunson, a superstar poker player, interviewed on the radio. He told the hosts of the show that while he had earned millions at the poker table he lost it all gambling on sporting events. In a voice that was both sad and wise, he assured the audience that no matter what your weakness, whether it was alcohol, drugs, gambling, or women, Las Vegas would take you down. Where else in the world would you find a luxury car dealership in or right next to a hotel?
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